Every mandatory monthly obligation attached to a Scottsdale property gets added to your housing expense before an underwriter tests your debt-to-income ratio. Master association dues, sub-association or village dues, condominium assessments and mandatory club dues all count, and in Scottsdale that stack routinely reaches a four figure monthly number before the mortgage payment enters the calculation.
That is why two buyers with identical incomes get very different approvals here, and why a Scottsdale pre-approval built without the property's actual dues is close to worthless.
The stack, in the order an underwriter builds it
- Principal and interest on the mortgage
- Property taxes
- Homeowners insurance, including any flood or supplemental coverage
- Master or community association dues
- Sub-association or village dues, where the community has layers
- Mandatory club dues and minimums
- Recurring special assessments
- Every other monthly obligation on your credit report: cars, cards, student loans, other properties
Items one through seven are your housing expense. Add item eight and you have total debt. Divide by gross monthly qualifying income and you have the ratio the program tests.
Two structural points most buyers miss.
Layers are common in Scottsdale. Master-planned communities frequently have a community association and a village or neighborhood sub-association, each billing separately. Buyers routinely quote one number and get surprised by the second. Ask specifically: "Is there more than one association billing this address, and what does each charge?"
Mandatory is the test, not typical. An obligation you can decline is generally not counted. One you cannot decline is. This is the whole question with club dues, which is why it gets its own page: How a Scottsdale Golf Club Membership Affects Your Mortgage Approval.
How each item is actually treated
Regular HOA and association dues. Counted as a recurring monthly housing obligation. If billed quarterly or annually, converted to a monthly figure. Straightforward.
Condominium assessments. Same treatment. Note separately that on a condo, the master insurance policy affects what individual coverage you need, which affects the insurance line.
Special assessments. This is where it gets specific:
- A recurring special assessment, billed monthly over a defined period, behaves like dues and is counted while it runs.
- A one time special assessment due before or at closing is cash to close, not a monthly obligation. It reduces the assets you have left, which can matter for reserves.
- An assessment approved but not yet billed should be disclosed and will often be treated as a known future obligation. Ask the association directly whether any assessment has been approved, not merely whether one is currently being billed.
Mandatory club dues and food or beverage minimums. Counted if you cannot decline them. A minimum you are billed whether or not you use it is an obligation, not a discretionary expense.
Capital assessments at a club. Recurring ones behave like dues. One time ones are cash.
Transfer fees and capital contributions at closing. Cash to close. Common in Scottsdale communities and frequently missed in a buyer's cash-to-close estimate.
Why this bites hardest in Scottsdale
Three reasons this city is different from the rest of the Valley.
The obligation stack is larger. Guard-gated communities, master-planned developments with layered associations, private clubs and high-rise condominiums with substantial amenity budgets all push the monthly number up.
The loan amounts are larger. Above the conforming limit, jumbo programs apply tighter ratio tolerances than agency loans do, so the same dollar of dues does more damage. See Jumbo Loans in Scottsdale.
A lot of Scottsdale buyers are self-employed. If your qualifying income has already been reduced by two years of legitimate deductions, a four figure obligation compresses the ratio from both ends at once.
The practical consequence: in Scottsdale, the dues can move your purchase price more than a quarter point of rate will. Buyers spend weeks shopping rate and five minutes asking about dues. That is backwards.
Run the numbers before you shop, not after
Do this before you look at a single house:
- Pick the communities you are actually considering.
- Get the real monthly figure for each: master dues, sub-association dues, any mandatory club dues and minimums, and any assessment currently running or already approved.
- Give those numbers to your lender and get an underwritten approval that includes them.
- Now you know your price, and it is the real one.
An approval that assumes a placeholder HOA figure is a guess. When the actual number lands in underwriting, the guess gets replaced and the approval moves. That is the phone call nobody wants two weeks before closing.
When the ratio does not clear
If the stack pushes you past program limits, there are documented alternatives. None is a shortcut around qualifying; each proves repayment capacity differently and each prices differently than agency financing.
Asset depletion. Qualifying income calculated from verified liquid assets rather than earnings. Often the right answer for a Scottsdale buyer whose wealth sits in accounts. Retirement accounts are typically discounted and pledged assets generally excluded.
Bank statement. Twelve or twenty four months of deposits with an expense factor applied, for the business owner whose returns are deducted down.
No-ratio. No debt-to-income test at all. Credit, assets, reserves and the property carry the file.
A larger down payment. Sometimes the simplest fix. Lowering the loan amount lowers the payment, which lowers the ratio. Weigh that against your reserve requirement, because spending your reserves to fix your ratio can break the other test.
If your income and the stack both clear on a conventional or jumbo loan, take it. It is almost always the cheapest money available.
Your checklist
- How many associations bill this address, and what does each charge?
- Is club membership mandatory, and what are the dues and minimums?
- Is any special assessment currently billed, or approved but not yet billed?
- What transfer fees or capital contributions are due at closing?
- Get the association budget and reserve study, not just the dues figure.
- Get fully underwritten with the real numbers. A pre-qualification is a calculator that has never seen your dues; an underwritten pre-approval has.
Why bring this file to us
- We ask for the real dues on the first call, because that number sets your price.
- We read the association budget and the club plan before you are committed.
- We read the returns ourselves and build the whole obligation stack with you.
- Broker model. Multiple investors rather than one bank's shelf, which is what a tight-ratio jumbo file needs.
- You talk to the principal. Ricky Khamis is President of EPiQ Lending, NMLS #173141, lending in Arizona since 1999 and a 2025 Presidents Club Winner at CMG Home Loans. Direct line: (480) 999-9842.
EPiQ Lending is NMLS #1936984, at 7975 N. Hayden Road, Suite A-101 in Scottsdale. Verify all of it before you trust any of it: Ricky's EPiQ Lending profile, the Scottsdale branch, and the license itself at NMLS Consumer Access. Hold every lender to that standard, including us.
Send me the community and the dues before you shop, and I will tell you what you actually qualify for there.
Equal Housing Opportunity. This is general information, not a commitment to lend or an offer to extend credit. Association dues, assessments and club obligations vary by community and change over time; confirm current figures with the association and the club. Rates, terms, and program guidelines change and depend on credit approval, property appraisal, and other qualifying factors. Not all applicants will qualify. Non-QM and no-ratio financing carries different pricing and terms than agency financing.
